Please activate JavaScript!
Please install Adobe Flash Player, click here for download
ePaper created 2017-02-08, 10:08:19 | version 1.38.0
08 Dental Tribune United Kingdom Edition | 1/2017 BUSINESS By Alan Suggett, UK According to the current timetable set, HM Revenue and Customs (HMRC) new Making Tax Digital (MTD) scheme is to commence on 6 April 2018. Announced by the government two years ago, it will present a severe headache for the majority of dentists and be yet another cost that they will have to cover. The department has been holding consultations on the ini tiative, and these concluded on 7 November 2016. The aims of the scheme appear to be laudable in terms of simplifying and making the tax system more efficient. However, the dental industry will face specific challenges. Theore tically, MTD should be a positive step for all who embrace the In ternet and digital commerce, and it should be a very efficient way to streamline tax calcula- tions and submissions. However, until dental practices routinely have regular, accurate manage ment accounts, which currently very few have, it will simply be yet another extra cost for most practice owners. One of the key tenets of the scheme is the submission of quar terly updates to HMRC. This may not present much of an issue to most businesses, as they are used to paying VAT on a quarterly basis and preparing monthly manage ment accounts. However, dentists are not registered for VAT, and even larger practices do not gen erally prepare monthly manage ment accounts, and if they do, these are usually not a true rep resentation of taxable profits, and various adjustments are required at the year end. Practice owners usually do not have financially trained staff and use external accountants to pre pare accounts under normal cir cumstances. In the case of associ ates, almost all will rely on external accounting support. While there are fairly sophisti cated software packages available that automate a large part of book keeping and can make this less tiresome, there is a potential prob lem with even the best account- ing software. Accounting systems gather financial transactions, so would not take into account the reduction in profits due to falling behind in UDA performance (as the practice continues to be paid the full monthly contract value) in the case of an underperforming NHS practice. The link between the account ing software and HMRC, unless manually overridden, will sim- ply communicate the overstated profit level for three quarters and then the final year end return will adjust the profit downwards to the correct level. HMRC has not said what it will do with the quarterly information, but the danger is that such fluctuations will lead to greater scrutiny, and the only way to make the quarterly returns more accurate (for most practices) would be to obtain help from an accounting professional, at extra cost. Another proposal of MTD is to widen the cash basis as a method for calculating profits for tax pur poses. On the surface, this may appear attractive, but owing to accounting for NHS earnings and the link between these and NHS pension contributions, a move to do this could result in significant complications in relation to tax and pensions. Another headache for dentists The challenges of HMRC’s Making Tax Digital scheme Alan Suggett is a chartered accountant and partner at UNW chartered ac countants, where heisheadofthe Dental Business Unit, which looks after more than 400 dentist clients throughout the UK. He can be contacted at alansuggett@ unw.co.uk. Agents and distributors WANTED We have reinvented teeth whitening for you! Immediately after your hygiene session! Without gum protection! In just 10 minutes! Attract new clients Fast whitening After each dental hygiene session BlancOne CLICK (CP 16%) - 10’ Multiply your revenue Complete in office whitening treatment BlancOne TOUCH (CP 16%) - 20’ BlancOne ULTRA (HP 29%) - 12’ Loyalise your patients Treatment management Patient comunication Individualised maintenance App BlancOne PRO www.blancone.eu from 9,90 € per treatment IDS SpA - Italy - 17100 Savona Via Valletta San Cristoforo, 28/10 Tel. +39 019 862080 - info@idsdental.it www.idsdental.it Loyalise your patients Treatment management App BlancOne PRO Tel. +39 019 862080 - info@idsdental.it Hall 11.3 stand A-078 Visit us at AD Tel. +39019862080 - info@idsdental.it Tel. +39019862080 - info@idsdental.it Hall 11.3